AI is moving inside the operations, and behind the CEO desk, at America’s small businesses

January 8, 2025

Updated: January 8, 2025

It’s no secret that large corporations are using generative artificial intelligence to get ahead — but many small businesses are finding ways to use this technology to their advantage, too.

To be clear, there’s still a large chunk (43%) of small businesses that have never even considered using gen AI in their operations, according to the 2024 State of Small Business survey of 1,300 respondents from small business software company Gusto. But nearly a third are experimenting with it while a quarter have already seen the upside, the survey found.

Nicholas Tremper, senior economist at Gusto, said the biggest benefit for small businesses using gen AI is getting ahead in the race for talent.

“Small businesses tell us that they continue to have difficulty hiring,” Tremper said. “Employees are looking for ways to use their skills most effectively in a business.”

Tremper said owners and employees are strapped for time and resources and wear many hats, but allowing workers to focus on the skills they want to use while gen AI takes the excess makes a workplace more attractive. That explains why gen AI-equipped small businesses are 45% more likely to fill open roles, Gusto reports.

Industries most impacted by labor shortages in the U.S. include education, health care, hospitality and professional services (which includes a wide swath, like legal services, landscaping, cleaning and waste disposal). Gusto has found that it’s some of these same industries where gen AI is most helpful. “These are businesses that are important to the local economies, but also important to the local culture,” he said.

Ric Nelson, founder and executive director of the non-profit disability advocacy organization Peer Power, based in Anchorage, Alaska, has a severe disability, cerebral palsy, which he contracted during an accident just after his birth. He wasn’t expected to survive, but now he has three degrees and runs a small business of his own, among other accomplishments.

In a written interview conducted with the help of generative AI, Nelson said, “Because it is difficult for me to type, AI makes it possible to put my information into articles and presentations much more effectively and quickly.”

He uses gen AI to proofread his work, help him submit highly complex grant proposals, and even wrote a book. Whereas Nelson used to have to provide short, often incomplete responses because of his disability, AI has enabled him to “share the full breadth of my ideas and vision,” he said.

“If a small business has a strong vision and strategy, it can now communicate just as strongly as a large corporation,” Nelson said. “It also opens up the means for people with disabilities to start more businesses, with more success, to earn their own money and have less need to rely entirely upon public assistance.”

Nelson now has an AI “clone” of himself created on Delphi. By uploading 422,000 documents into a database, people who work with him or receive consulting from him can chat with the clone about his opinions, ideas, and even his own experiences in life and business. Plus, Nelson will now have an audible voice that people can understand at a normal tempo, without the need of a voice-over or interpreter.

Todd Miller, president of Ohio-based Isaiah Industries, which manufactures specialty residential metal roofing and has about 50 team members, said in addition to using gen AI for content creation, website copywriting and podcast ideation and scriptwriting, his compant recently used the technology to generate a training video for contractors who sell its products. “We started out intending to just film the video but then decided that AI would save us some time, allowing us to get the training into the hands of our customers more quickly,” he said.

Earlier in 2024, Bennett Camarda and her husband, Bill, took over Limitless Fitness, a New Hampshire gym with more than 10 trainers and 150 active one-on-one clients. “We’re using AI to accelerate growth and scale our operations while keeping our clients at the center,” said Camarda.

Camarda said they have used ChatGPT Premium to write Excel formulas, which has helped them streamline contract operations from an hours-long process to one that takes minutes. “It’s even helped us revamp our brand strategy, refining our tone, voice, and messaging to better resonate with our evolving client base, from strength training for grandparents to optimizing performance for golfers,” Camarda said. That’s not to mention use cases like writing operations manuals or creating heatmaps to track their busiest times so they can add more training sessions where they’re most needed.

Despite the learning curve that comes with taking over a new business, Camarda said they’ve already nearly closed the -5% year-over-year revenue gap left from the previous owners, while bringing trainer and client engagement to an all-time high.

“Gen AI has freed up our time to invest in our community and focus on opening a second location, rather than being stuck in the day-to-day operational weeds,” she said.

A recent American Express survey found that small business owners adopting AI feel better positioned to grow and expand (50% of businesses that use AI plan to grow their workforce in 2025, compared to 36% of non-AI adopters).

“Small business owners are the chief everything officer,” Tremper said. “They’re hiring their early employees to help them build the business and wear just as many hats as they wear. Gen AI can not only take off hats from the business owner, but it does some of this for the employees as well and helps increase their productivity.”

While gen AI has no shortage of risks — like data security and hallucinations, for example — Tremper said small business owners are treading cautiously to avoid major pitfalls. “People are being very thoughtful about this technology and how to implement it in ways that make their business and workforce better,” he said.

Chris Washington https://whnynews.com

Chris Washington brings over 25 years of experience in financial journalism to WHNY News. A Schenectady native, Chris has a keen eye for business trends impacting upstate New York. His insightful reporting has earned him numerous accolades. Chris holds a degree in Economics from Syracuse University.